Insurance

MAIN INFORMATION ON THE INSURANCE OF LIABILITIES TO INVESTORS

UAB „Dovre Forvaltning“ liabilities to investors are insured

“Dovre Forvaltning” is a member of the Republic of Lithuania liabilities to investors’ insurance system.

Insurance of liabilities to investors is offered by the state company “Deposit and Investment Insurance” according to the provisions of Law on Insurance of Deposits and Liabilities to Investors of the Republic of Lithuania.

The insured amount of liabilities to investors (insurance limit)

Up to 22 000 EUR1

The currency of insurance compensation for the liabilities to investors

Euros (with euro cent accuracy: with accuracy of two digits after the comma and rounded up in accordance with the mathematical rules of rounding).

The object of insurance of liabilities to investors

The object of insurance of liabilities to investors shall be the financial instruments of the investor, regardless of the currency in which they are denominated, and/or funds in all currencies.

The term for insurance compensation payment

The compensation for liabilities to investors shall be paid within 3 months from the day of an insured event. In exceptional circumstances the council of the insurance undertaking, in agreement with the supervisory authority, may extend this time limit for no more than 3 months.

Cases, where the liabilities to investors are not insured

The object of insurance of liabilities to investors is not the investment risk (investment risk shall mean a possibility of losses due to the fact that the investment will not be profitable or will lose its value).

The liabilities to the following investors shall not be the object of insurance of liabilities to investors:

1) the Bank of Lithuania;

2) credit institutions;

3) financial brokerage firms;

4) financial institutions;

5) insurance and reinsurance companies functioning in accordance with Republic of Lithuania Law on Insurance;

6) pension funds;

7) collective investment entities.

Conditions when certain restrictions apply to the payment of the compensation for liabilities to investors

The payment of the compensation for liabilities to investors may be deferred when the investors and other persons entitled to claim the compensation for liabilities to investors laid down in Article 23 paragraph 6 of Law on Insurance of Deposits and Liabilities to Investors of the Republic of Lithuania, have been charged with an offence arising from money laundering, until the final decision of the court is enforced.

2. to the investors holding financial instruments and/or funds, regarding which a conviction was handed down resulting from a criminal proceeding on money laundering.

3. to the heads of administration of the participant of the insurance system of liabilities to the investors, members of council and board (supervisory board), persons holding at least 5 per cent of the share capital of the participant of the insurance system of liabilities to the investors, persons performing independent audit of the participant of the insurance system of liabilities to investors (who performed an audit not more than one year before the insured event of liabilities to investors).

4. to the close relatives and third parties acting in the name of persons listed in subparagraph 3 of this section.

Explanation about the types of claims and circumstances when the relevant deposit insurance system or the insurance system of liabilities to investors apply

For claims, expressed by financial instruments shall only insurance system of liabilities to investors be applicable.

Funds of financial brokerage (investors’) firms’, transferred to the financial brokerage firms in order to buy financial instruments, and funds of clients’ (investors’), while selling financial instruments belonging to the clients (investors), which are held in the bank account, opened on behalf of the financial brokerage firm, are considered as liabilities to investors and to such funds apply the protection of insurance system of liabilities to investors.

Examples of circumstances and claims, where the insurance system does not apply

The object of insurance of liabilities to investors is not the investment risk.

Other information about the conditions of liabilities to investors, terms and conditions on insurance compensation payments

The insurance compensation for liabilities to investors shall be calculated and paid by the insurance undertaking, based on the data on the investors, their liabilities to investors and the amount of the supplementary compensation for liabilities to investors, held by the participant of the insurance system of liabilities to investors at the day of the insured event for liabilities to investors, as well as data provided by the participant of the insurance system of liabilities to investors on the market value of the investor’s securities on the day of the insured event of liabilities to investors.

When calculating the amount of insurance compensation for liabilities to investors, all the liabilities to investors relating to the financial instruments and funds held by one investor (including branches of a legal person or another organization of the depositor, representations, and other structural branches), which cannot be repaid by the participant of the insurance system of liabilities to the investors, are summed up but the total insurance compensation for liabilities to investors shall not exceed 22 000 EUR.

If a group of persons (joint investment) has the right of claim to funds and/or financial instruments under contracts, every person from the group is considered investor, and financial instruments and funds shall be equally shared, unless otherwise specified in the contracts giving rise to the right of claim, or in court rulings.

If the investor is handling funds and/or financial instruments belonging to other persons under a contract, then the right of claim shall be assumed by the person who owns funds and/or financial instruments on the grounds of property, trustee or other rights, and who is known or can be ascertained before the day of the insured event of liabilities to investors. Where the funds and/or financial instruments are held by a group persons, financial instruments and funds shall be equally shared in accordance with the share established in contracts giving rise to the right of claim. This provision shall not apply to a servicer managing collective investment undertakings and pension funds.

The amount of insurance compensation for liabilities to investors shall be calculated at the market value of the financial instruments of the investor on the day of the insured event of liabilities to investors. The amount of insurance compensation for liabilities to investors held in foreign currency shall be calculated in accordance with the indicative exchange rates of the euro and foreign currencies, last published by the European Central Bank on the day of the insured event of liabilities to investors, and in the cases when the European Central Bank does not publish the exchange rates of the euro and foreign currencies – in accordance with the indicative exchange rates of the euro and foreign currencies, last published by the Bank of Lithuania.

The investor’s right to the insurance compensation for liabilities to investors shall be valid for 5 years after the day of the insured event of liabilities to investors. Disputes related to the investor’s right to the insurance compensation for liabilities to investors shall be settled by ordinary courts in accordance with the procedures laid down in laws.

A person who has unduly or erroneously received a compensation for liabilities to investors must refund it to the Insurance Fund of Liabilities to Investors. The Insurance Fund of Liabilities to Investors shall have the right to claim the reimbursement of unduly or erroneously paid compensations for liabilities to investors, which is valid for 5 years from the day of the payment of compensation for liabilities to investors. The refunded or enforced amounts are credited to the Insurance Fund of Liabilities to Investors.

The payment of the compensation for liabilities to investors shall be made without it being necessary for the investor to submit a request to the insurance undertaking. The insurance undertaking shall publicly inform the investors, within the time line established by paragraph 11 of this Article, on the insured event of liabilities to investors, and the payment procedure of the compensation for liabilities to investors, as well as publish this information on its website.

The amount of supplementary insurance coverage of liabilities to investors shall be equal to the difference between the total of liabilities to investors and the amount payable to the investor under legislation of a Member State or third country, but the insured amount of liabilities to investors may not exceed 22 000 EUR.

The liabilities to investors of branches of banks of a third country, branches of financial brokerage firms of a third country and branches of servicers of a third country established in the Republic of Lithuania, which are not insured (compensated) or their protection is not ensured under the legislation of a third country, shall be insured under this Law.

The investor shall have the right to the payment of insurance compensation for liabilities to investors from the day of the insured event of liabilities to investors.

The investor shall have the right to the payment of insurance compensation for liabilities to investors where the participant of the insurance system of liabilities is unable to fulfil the following liabilities to investors, assumed under legal acts or contracts:

1) repay the funds belonging to the investor and held in his name, that have been transferred to the participant of the insurance system of liabilities to make use of the investment services provided by it;

2) repay the financial instruments belonging to the investor, that are held, managed or controlled in his name which have been transferred to the participant of the insurance system of liabilities to make use of the investment services provided by it.